Page 14 - Farm and Food Policy Strategies for 2040 Series

“Those who are coming back to the farm are going to be more educated than their parents and
grandparents before them. They intend to do things differently. They grew up in a disruptive era.
They don’t necessarily have the same appreciation for the lifestyle that their parents and
grandparents did. They don’t want to wake up one morning, work on the farm all day, eat dinner
and do it again the next day. They want to run a very efficient operation; they want to make
money. They want to have other interests and do other things,” he adds.

Seventy-five percent of farmers 35 and under said, “As soon as I’m in charge, I’m going to
integrate new technology,” according to Aimpoint Research. At the same time, 71% plan to
increase efficiency, 63% plan to improve marketing and 48% plan to expand acreage.

Technology is having a different effect on ag than it has in the past, says Sciotto.

“Like with marathons, when the gun goes off, there is a huge gaggle trying not to trip over each
other. But that group of runners is largely spreading out. We see that farmers who are willing and
able to adopt new technology are getting further ahead and those unable or unwilling to do so are
falling further and further behind. That’s impacting who is likely to be successful in the future.”

Consumers: Consumers are the center of gravity that’s propelling a lot of the change in
agriculture, and about two-thirds said they are thinking about where their food comes from,
according to a recent Aimpoint Research survey. “What really drives consumer decision-
making is price, healthiness and freshness,” says Sciotto. “And what consumers perceive is
largely what retailers are adapting to. Consumers perceive that non-GMO is better than GMO
and that organic is better than non-organic. They also perceive that local is better even though
the definition of local varies from a ‘farm in my community’ to a ‘farm in the U.S.’ We, in ag,
know that a lot of those belief systems may be unfounded or unrealistic but, nonetheless, retailers
are responding.

“Organic continues to grow and we see the emergence of new innovations in protein like the
Impossible Burger and Memphis Meats. Many traditional protein companies are investing
because – even though lab-based protein sources could still be 5-10 years off, they could be
significant disruptors and put pressure on corn and soybean markets in the U.S. if some of
the livestock production shifts.”

Consumer interest in electric vehicles could be another disruptor, Sciotto says.

“By 2040, it’s very likely we could see a significant decline in the number of combustion
engines. If you lose ethanol – which consumes about 40% of the U.S. corn crop today – it will
lead to significant changes,” he adds.

“Between alternative proteins, the regulatory pressures on animal agriculture, shifting consumer
patterns and the potential loss of ethanol, I think there could be a significant amount of acres
under some level of risk,” Sciotto says.

Sciotto expects more food companies and retailers to cater to what their consumers believe they
want – whether it’s founded in good science or insights, or not. And those decisions end up down
on the farm.

12 www.Agri-Pulse.com